Retinal degeneration affects millions of people around the world each year. For the past decade, my lab has studied the coordination of proliferation and differentiation in the developing retina and in proliferative diseases of the retna such as retinoblastoma. Recently, we made a startling discovery that has fundamentally altered our understanding of the molecular and cellular mechanisms of retinal development and may also have a major impact on efforts to restore vision in some patients with retinal degeneration. We discovered that individual retinoblastoma tumor cells express multiple developmental programs simultaneously. This occurs through deregulation of the epigenetic programs that are directly or indirectly regulated by the RB1 protein. To explore this exciting finding further, we developed a novel experimental system to quantify the epigenetic reprogramming of individual retinal neurons by using 4 factors (Oct4, Klf4, Sox2, and Myc) and somatic cell nuclear transfer. We discovered that the epigenetic barriers to reprogramming dramatically differ across retinal cell types, and they are developmental stage-specific. Moreover, we have used the Sasai 3-dimensional culture system to show for the first time that mouse iPSCs can form the optic cup and differentiated retinae. One of the most exciting results from these experiments is that our iPSC lines derived from retinal neurons bypass the normal transition through anterior neuroectodermal specification. Instead, they retain retinal epigenetic memory and form exclusively retinal progenitor cells that differentiate into laminated retinae. The iPSCs derived from retinal neurons retain their epigenetic retinal memory for at least 50 passages, whereas iPSCs generated from genetically identical MEFs rarely produce retinae in this system. We have now shown that the photoreceptor precursors derived from retinal iPSCs can integrate into the retina; thus, iPSCs generated from mature retinal neurons may provide a renewable source of photoreceptor precursors for cell-replacement therapies to restore vision in those who suffer from retinal degeneration. This innovative research proposal will advance our understanding of the role of epigenetics in retinal development and begin to elucidate the molecular mechanisms and cell type-specific target genes involved in that process. It will also provide crucial preclinial data on the use of retinal-derived iPSCs for future clinical trials of photoreceptor-replacement therapy to treat retinal degeneration.